McMullen Testifies Kroger-Albertsons Merger Was 'Doomed From the Beginning'

Former Kroger Chairman and CEO Rodney McMullen told a court on Tuesday that the $24.6 billion grocery merger he championed was "just doomed from the beginning," Bloomberg reported.

The testimony came during the ongoing trial over whether Kroger is to blame for the deal's implosion in late 2024. Albertsons claims Kroger ruined the merger and should pay billions in damages. McMullen said the transaction failed because the FTC under then-Chair Lina Khan was deeply opposed to mergers.

What does the testimony change?

Kroger and Albertsons announced their merger plan four years ago, and Kroger repeatedly expressed confidence that regulators would approve it. In retrospect, McMullen had reason to doubt the deal even as he claimed it was set for success, according to his own court statements.

Khan's skepticism was public. In January 2022, she said mergers were "threatening to concentrate our markets further" and that ordinary Americans had "lost out" even as deal-making soared. Kroger and Albertsons retained sophisticated antitrust legal counsel who would have flagged the risk.

McMullen also testified that he depended on his lieutenants to manage the relationship with Albertsons during the merger process. That admission partially validates testimony from former Albertsons CEO Vivek Sankaran, who told the court on Monday that Kroger was not responsive to his efforts to reach McMullen directly. Sankaran said he should not have been shunted to people other than McMullen when he wanted to raise concerns.

What is Albertsons arguing?

Sankaran argued that Kroger set the deal up for failure by offering the FTC underwhelming store-divestment proposals even as the agency signaled possible opposition. He underscored that Kroger firmly controlled the companies' negotiations with the regulator — and, by extension, the deal's fate.

McMullen pushed back, testifying that Kroger lived up to its obligations under the merger agreement, according to Bloomberg.

The merger was a highly complex undertaking that would have challenged any management team. But regardless of how the judge rules on Albertsons' damages claim, one question will persist: if the companies knew — or should have known — that clearing the FTC would be monumentally difficult, should they have attempted the merger at all?

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Whatever the verdict, the trial record now shows the CEO who built the deal believed it faced near-certain regulatory death from the start.